Funding
How much will it cost to buy a Martin & Co franchise?
The franchise fee is £18,500 + VAT. The VAT can be claimed back once you have registered your business for VAT.
How do I pay the franchise fee?
You will need to have liquid capital of £18,500 + VAT. This could come from savings, inheritance, re-mortgaging your home, selling or releasing equity from an investment property or from a redundancy settlement.
Will a bank lend me the franchise fee?
No. A bank needs to see evidence that you are making a financial commitment to the venture. However, if you can find the £18,500 then a bank could lend up to 70% of the total cost of getting the business started - including working capital to cover your early trading losses and a modest level of drawings for yourself from 'day one'.
How do I obtain the additional funding?
The Martin & Co business plan is recognised by major banks. We work with each franchisee to develop a highly detailed 5-year business plan that is tailored to your circumstances and chosen territory. The plan is in a format that our regular banks are familiar with and confident in.
As part of this process the bank will conduct credit checks. You are able to obtain a copy of your own credit report from organisations such as Equifax, Experian and/or checkmyfile.
Which bank shall I choose?
Martin & Co have dedicated points of contact so we can advise who you to speak to. If you already have a good relationship with a banker then we can help you present the plan to your local contact.However make sure the bank you select is familiar with and supportive of a franchising business model. Useful bank contacts include HSBC and Nat West .
How do I write a business plan?
We work with you to write the plan. The plan is based on information about your proposed territory. As the prospective franchisee this research is carried out as part of your due diligence to ensure realistic projections. The business plan is projected to be debt free at the end of 5 years, with substantial earnings and strong asset value.
Does the business plan include my salary?
Director's drawings from 'day one' are set at a modest level which can be increased as the business moves into profit. Franchisees may also be able to pay themselves a shareholders dividend on the net profits of the business after corporation tax - this can be much more tax efficient than PAYE. Your accountant or tax adviser should be able to provide you with more information.
Other expenses that the business can fund include the provision of a car.
What happens if I do not secure bank funding?
If you do not have assets to offer as security on a bank loan, or your assets are jointly owned and the other party is not directly involved with the business and does not want to offer them as security then an alternative to consider is 'The Small Firms Loan Guarantee' (SFLG.) This loan helps to overcome lack of asset security by providing lenders with a government guarantee against default in certain circumstances.
